Following Donald Trump's victory in the US presidential election on November 5, Bitcoin soared above $76,000.
Bitcoin (BTC) analyst PlanB’s stock-to-flow model currently predicts a target price of $500,000 for the asset within the next four-year cycle, based on the model’s historical data and patterns. .
Plan B pointed to President Trump's proposal to create a national BTC reserve as a potential demand driver, suggesting it could add buying pressure of “200,000 BTC per year.”
“If history is any guide, if the stock-to-flow model is any guide, prices will rise sharply from here,” the analyst said.
Related: Bitcoin Experts Alert as 'Impersonate City' Exacerbates BTC Price Rise by $77,000
Stock-to-flow model target price
The stock-to-flow model, which values Bitcoin based on limited supply and planned halvings, suggests a significant price increase after each halving event.
Analysts expect BTC prices to reach $500,000 this cycle, but point out that there is wide variation between $250,000 and $1 million per BTC.
sauce: Plan B
Related: BlackRock Bitcoin ETF flips gold fund
Institutional demand and government interest
The new Trump administration is expected to encourage the growth of institutional investors in BTC, with Senator Cynthia Lummis pushing for the creation of a BTC reserve fund similar to the gold reserve fund.
The new administration could issue an executive order allocating federal funds for BTC acquisition and establishing new readiness standards.
PlanB also highlighted companies like MicroStrategy, which has announced large-scale BTC purchasing plans, with CEO Michael Saylor pledging to purchase 200,000 BTC annually over the next three years.
Related: $9.3 billion inflows into stablecoin exchanges have traders wary of soaring Bitcoin prices
“Impersonation cities” hurt Bitcoin profits
In a Nov. 8 post on X, popular trader Skew expressed concern about a deceptive order book technique known as “spoofing.” Although this method is prohibited in legacy markets, it is common in crypto trading.
This practice, suspected from the recent $77,270 BTC high trade seen on Bitstamp, involves placing large bands of liquidity at price points and thinning them out or removing them entirely after a price reaction.
Other commentators and traders echoed these concerns.cited that despite the “massive” inflows and subsequent potential long squeeze, BTC’s historically aggressive upward trajectory is nowhere to be seen.
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